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Biopharma - Australia can borrow fund in Australia with an interest rate of 1 1 . 2 1 % to invest 1 . 6 2

Biopharma-Australia can borrow fund in Australia with an interest rate of 11.21% to invest 1.62 million Chinese yuan (CNY) and expected return of CNY2.13 million next year. Assume that Biopharma-Australia and Haier-China engage in a parallel loan in which the Haier-China gives Biopharma Australia CNY1.62 million in exchange for a loan in Australian dollar (A$) at the current exchange rate A$0.1964/CNY. These loans will be repaid by both parties at the end of one year. Assume that next year, Biopharma-Australia will pay the Haier-China 14.33% interest on CNY1.62 million and that the Haier-China will pay Biopharma-Australia 7.18% interest on the Australian dollar loan. Also, Biopharma-Australia believes that the CNY will appreciate to A$0.2818/CNY next year. How much the Biopharma-Australia will make a profit or loss in A$ from this parallel loan agreement in one year. (enter the whole number with no sign or symbol)

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